If month-over-month inflation remains contained, the first opportunity for 2.3 year-over-year decline is April 2022, given base effects. Will it happen? Know the mechanics and drivers of Y/Y elevated but M/M not—focus on month-over-month evolution each inflation print 0 2. n o i s r e 1 V 2 202 Inflation (%) r e b o t Month-over-month inflation has c 25 O 14 been contained, highlighting that ed t a d 12 p year-on-year prints are driven by base u es v i 1 1M annualized change t effects 10 ec p s er 3M annualized change P e v 8 i t Year-over-year prints must stay u ec 6M annualized change x 6 E high until at least April and May of G C B . ed 2022, which is the first opportunity to 4 12M annualized change v er es roll out of high base effects of April r s 2 t h g i r and May of current year l l A 0 . p u o r G g -2 n I f mont h-over-month remains at i t l u s n current levels until then, year over -4 o C n o 1 3 5 7 9 t year inflation would fall by May 2022 1 3 5 7 9 11 1 3 5 7 9 11 s -6 o B 2020 y 2019 2021 b 1 2 0 2 © t h g i r y p o 1. Base effect refers to the impact of the corresponding “base” or period of the previous year on current growth estimates (e.g., during 2020 low core CPI); 2. Based on Core CPI C Source: BLS, BCG 1515